Builder Faces ₹6 Crore Penalty, Know- What Went Wrong For Nearly 20 Years?

Mumbai: A Mumbai builder has been ordered to pay Rs 6 crore in compensation after allegedly failing to obtain an Occupation Certificate (OC) for a redeveloped residential building for nearly two decades.

The National Consumer Disputes Redressal Commission (NCDRC) passed the order after examining a complaint filed by the affected housing society.

What Is The Case?

The dispute concerns Balaji Apartments in Santacruz, Mumbai. Tirupati Devi Co-operative Housing Society entered into a redevelopment agreement with Raja Construction Company in 2005.

Under the agreement, the developer was required to demolish the old structure, construct a new building and provide flats to the existing society members.

Who Was Responsible?

The builder was also responsible for obtaining the OC and completion certificate, providing a new water connection and securing all required government approvals.

Possession of the flats began in 2008, but the society alleged that the developer failed to complete the necessary documentation and pending work.

Why Was The Builder Penalised?

According to the society, construction was not carried out according to the sanctioned building plans. The alleged additional construction prevented the authorities from issuing the OC.

Consequently, residents faced prolonged uncertainty, additional expenses and concerns over the building’s legal status.

Where Did The Builder’s Defence Fail?

The builder denied the allegations and claimed that alterations made by some flat owners had prevented the OC from being issued.

However, the commission reportedly found no convincing evidence supporting this defence.

When Must The Payment Be Made?

The NCDRC directed the builder to pay Rs 6 crore within three months. Any delay will attract simple interest at 8 percent annually.

The developer must also obtain and hand over the OC to the society within 12 months and pay Rs 10 lakh towards litigation costs.

How Was Compensation Calculated?

The compensation includes around Rs 3.24 crore for the delay from June 2008 to August 2026 and Rs 26 lakh towards water connections and additional expenses.

Further compensation was added for the hardship and risks faced by society members, taking the total amount to Rs 6 crore.